Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 155407

November 11, 2008

PHILIPPINE NATIONAL OIL COMPANY, petitioner

vs.
LEONILO A. MAGLASANG and OSCAR S. MAGLASANG, respondents.
DECISION
LEONARDO-DE CASTRO, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the
Rules of Court, assailing the January 23, 2002 Decision1 of the Court of
Appeals (CA) in CA-G.R. CV No. 67341, as reiterated in its Resolution2 of
September 20, 2002, affirming with modification the Joint Judgment 3 dated
December 16, 1999 of the Regional Trial Court (RTC) of Ormoc City, Branch
35, in Civil Case No. 3267-O and Civil Case No. 3273-O.
On October 25, 1994, the Philippine National Oil Company (PNOC) filed a
complaint for eminent domain against respondent Oscar S. Maglasang, the
registered owner of a 63,333-square meter parcel of land identified as Lot No.
11900 and covered by TCT No. T-4097. The case was docketed at the RTC,
Ormoc City, Leyte as Civil Case No. 3267-O.
On November 10, 1994, the PNOC filed another expropriation complaint, this
time against respondent Leolino A. Maglasang, owner of the 98,206-square
meter parcel of land identified as Lot No. 11907, covered by OCT No. P18869. The case was docketed with the same RTC as Civil Case No. 3273-O.
The subject parcels of land are located at Lim-ao, Municipality of Kananga,
Leyte and to be used by the PNOC in the construction and operation of the
125MW Upper Mahiao Geothermal Power Plant Project.
The RTC issued writs of possession over Lot No. 11907 and Lot No. 11900 on
December 5, 1994 and December 13, 1994, respectively, after PNOC posted
the required provisional deposit.

On March 21, 1997, upon finality of the orders of condemnation in both

expropriation cases, the trial court appointed three commissioners to ascertain
and make a recommendation on the just compensation for the condemned
lots in accordance with Section 5, Rule 67 of the Rules of Court. Those
appointed were: Branch Clerk of Court Atty. Bibiano Reforzado, City Assessor
Briccio D. Supremo and businessman Augusto T. Pongos.
Upon conduct of hearing and ocular inspections and reception of the parties'
position papers and documentary evidence, Atty. Reforzado submitted a
Commissioners' Report dated February 18, 1999, attaching therewith the
different valuations recommended by the three commissioners. City Assessor
Supremo recommended the price of P 1,000.00 per square meter,4 Clerk of
Court Reforzado pegged the value of the lots at P 900.00 per square
meter.5 In his report, Mr. Pongos arrived at the lowest valuation of P 400.00
per square meter for the developed area and P 85.00 for the undeveloped
area. 6
Confronted with the commissioners' varying land valuations, the trial court
made its own determination of the just compensation taking into account the
range of prices recommended in the Commissioners' Report and documentary
evidence presented by the parties. Setting the reckoning period for the
computation of the just compensation at the time of the filing of the
complaints, the trial court pegged the value of the two lots at P 300.00 per
square meter. However, in the same decision, the trial court further increased
said initial valuation to P 700.00 per square meter to compensate for what it
termed as inflation factor and adjustment factor. Relying on the case
of Cosculluela v. Court of Appeals,7 the trial court ruled:
After examining the data, the Court would like to take the mean position
but similar to the ones taken by the Commissioners. For this, therefore,
the Commissioners' Report is hereby accepted. From the reckoning
date of 1994, the Court wants to apply a three-year period therefrom to
ascertain the prevailing price. The court has in mind the dictum in
Cosculluela vs. Court of Appeals (164 SCRA 393) which runs as follows:
just compensation means not only the correct determination of the
amount to be paid to the owner of the land but also the payment of the
land within a reasonable time from its taking. Without prompt payment,
compensation cannot be considered just for the property owner is made
to suffer the consequence of being immediately deprived of his land.'
The Court thus believes an inflation factor is to be applied in the
computation considering the time that elapsed since late 1994 up to the

present. Also an adjustment factor commonly adopted by appraisers is

included in the computations.
xxx
Wherefore, after considering all the foregoing, judgment is hereby
rendered fixing the amount of P700.00 per square meter as just
compensation for Lot 11900 under TCT T-4097 in Civil Case No. 3267-0
or the amount of P 44,333,100 and for Lot 11907 under OCT No. P18869 in Civil Case No. 3273-0 or the amount of P 68,744,200 to be
paid by the plaintiff to the respective defendants plus cost of the
proceedings.
SO ORDERED.
From the foregoing decision, both parties filed their respective appeals with
the CA.
On January 23, 2002, the CA rendered the herein challenged decision8 which
modified the decision of the trial court insofar as it reduced the just
compensation for the subject lots from P 700.00 to P 300.00. In arriving at
such a decision, the CA ratiocinated, thus:
We are of the opinion that the trial court reversibly erred in taking into
account such inflation factor' and adjustment factor' for the
determination of just compensation in this case. It has misapplied the
ruling in Cosculluela by substituting such inflation factor' and or
adjustment factor' for the legally mandated interest in the price to be
paid as just compensation in expropriation cases.
xxx Nowhere in the said decision may it be inferred that damages for
such delay in the payment of just compensation, other than the legal
interest provided by law, may be granted in addition or considered in
computing the amount of just compensation such as the inflation factor'
applied by the trial court. On the contrary, our Supreme Court has even
ruled that the de facto devaluation of the peso is not a factor in land
valuation for purposes of expropriation. Therefore, there is absolutely no
legal basis for the trial court's application of an inflation factor' and
adjustment factor' in the determination of just compensation in these
expropriation cases. The consistent rule has always been that the owner
of the property should be compensated only for what he actually loses;
it is not intended that his compensation shall extend beyond his loss or

injury. And what he loses is only the actual value of the property at the
time it is taken. This is the only way that compensation to be paid can
be truly just, i.e., just not only to the individual whose property is taken,
but to the public, which is to pay for it.' Hence, the price level for 1994
when the property was taken by plaintiff-appellant should be the proper
valuation for defendant-appellants' properties and not their subsequent
increased value after the passage of time.
xxx
WHEREFORE, premises considered, the present appeals are hereby
PARTLY GRANTED. The Joint Judgment appealed from in Civil Case
Nos. 3267-O and 3273-O is hereby AFFIRMED with MODIFICATIONS
in that the just compensation for the expropriated properties is hereby
ordered to be paid to defendant-appellants in the amount of P 300.00
per square meter, or the total amounts of P18,999,900.00 to defendantappellant Oscar S. Maglasang for Lot No. 11900 and P29,461,800.00 to
defendant-appellant Leolino A. Maglasang for Lot No. 11907, with
interest at the legal rate of 6% per annum from October 25, 1994 and
November 10, 1994, respectively, until full payment is made.
No pronouncement as to costs.
SO ORDERED
Still unsatisfied, petitioner filed a motion for reconsideration of the foregoing
decision but its motion was denied by the CA in the resolution of September
20, 2002.
Unable to accept the CA's decision for allegedly being contrary to law and
established jurisprudence, PNOC is now before the Court with the following
grounds in support of its petition:
A. CONTRARY TO THE RULING OF THE HONORABLE COURT OF
APPEALS, THE INITIAL VALUATION OF THE TRIAL COURT
OF P 300.00 PER SQUARE METER IS NOT WELL SUPPORTED BY
THE EVIDENCE ON RECORD AS REPRESENTING THE FAIR
MARKET VALUE OF THE EXPROPRIATED PARCELS OF LAND.
B. LIKEWISE CONTRARY TO THE RULING OF THE HONORABLE
COURT OF APPEALS, THE SUBJECT PROPERTIES WERE

AGRICULTURAL, NOT INDUSTRIAL, PARCELS OF LAND AT THE

TIME THEY WERE TAKEN FOR PUBLIC USE.
As we see it, other than the question as to the precise time the fixing of just
compensation should be reckoned, the rest of petitioner's arguments dwell
solely on questions of fact.
In expropriation proceedings, the value of the land and its character at the
time it was taken by the government are the criteria for determining just
compensation.9 This is so because, there are instances when the
expropriating agency takes over the property prior to the expropriation suit, in
which situation just compensation shall be determined as of the time of
taking.10 The reason for the rule, as pointed out in Republic v. Lara,11 is that
(W)here property is taken ahead of the filing of the condemnation
proceedings, the value thereof may be enchanced by the public purpose
for which it is taken; the entry by the plaintiff upon the property may
have depreciated its value thereby; or, there may have been a natural
increase in the value of the property from the time the complaint is filed,
due to general economic conditions. The owner of private property
should be compensated only for what he actually loses; it is not
intended that his compensation shall extend beyond his loss or injury.
And what he loses is only the actual value of his property at the time it is
taken. This is the only way that compensation to be paid can be truly
just; i.e., 'just not only to the individual whose property is taken,' 'but to
the public, which is to pay for it.
Here, petitioner insists that contrary to the findings of the two courts below, the
determination of just compensation should be reckoned prior to the time of the
filing of the complaint for expropriation. According to petitioner in Civil Case
No. 3267-O, petitioner took possession of the land on January 1, 1992 when
PNOC leased the same from its administrator as evidenced by a Lease
Agreement12 for the period of January 1, 1992 to December 31, 1992. Thus,
taking, for purposes of computing just compensation, should have been
reckoned from January 1, 1992.
We are not persuaded.
In the context of the State's inherent power of eminent domain, there is
"taking" where the owner is actually deprived or dispossessed of his property;
where there is a practical destruction or a material impairment of the value of
his property; or when he is deprived of the ordinary use thereof.13

In Republic v. Castellvi, 14 this Court held that there is a "taking" when the
expropriator enters private property not only for a momentary period but for a
more permanent duration, for the purpose of devoting the property to a public
use in such a manner as to oust the owner and deprive him of all beneficial
enjoyment thereof. Thus, in that case, we rejected the State's contention that
a lease on a year to year basis can give rise to a permanent right to occupy,
since by express legal provision a lease made for a determinate time, as was
the lease of Castellvi's land, ceases upon the day fixed, without need of a
demand. Neither can it be said that the right of eminent domain may be
exercised by simply leasing the premises to be expropriated. Where, as here,
the owner was compensated and not deprived of the ordinary and beneficial
use of his property by its being diverted to public use, there is no taking within
the constitutional sense.
In fixing the just compensation reckoned from 1994, the trial court took the
Commissioners' Report into consideration:
II. Time of the Taking.
In both cases the time of the taking may be reckoned in 1994. For Lot
11900, on October 24, 1994, the date of the filing of the complaint
although the plaintiff took possession of the property in 1991 due to a
lease contract executed between plaintiff and defendant yet the
intention to expropriate was manifested only upon the filing of the
complaint (NPC vs. CA and Macapanton Magondata, 254 SCRA 577).
For Lot 11907, the time of the taking shall be reckoned on November
10, 1994 where the institution of the case precedes entry of the
property, the just compensation is to be ascertained as of the filing of
the complaint.15
Accordingly, we quote with approval the trial court's ruling on this point:
Contrary to plaintiff's position, the lease in 1992 should not be construed
as taking in the constitutional sense. What constitutes taking' is when
the property is directly appropriated' and not to consequential injuries
resulting from the exercise of lawful power' (Taada and Carreon,
Political Law of the Philippines, Vol. Two, 1962 First Edition, Manila
Central Book Supply, Inc. 1 p.90, p. 92)

Following the doctrine in Castellvi, the trial court committed no error when it
reckoned the time of taking of the subject properties from the date of filing of
petitioner's complaints for eminent domain.
Petitioner would next argue that the subject lots were erroneously classified
as industrial land when in fact they were agricultural land at the time they were
taken for expropriation.
At the outset, we reiterate that the Court recognizes the power of a local
government to reclassify and convert lands through local ordinance.16
On this score, we quote the findings of the commissioners as contained in
their report on the ocular inspection conducted on October 29, 1997, and
summarized by the CA, to wit:
xxx (1) Lot 11907 was only recently flattened, there are no more trees,
no more plants except cogon grass and other wild plants; Lot 11900 has
also been flattened in the middle of which are two reinjection pumps,
and also found therein are some fruit bearing coconut trees; (2)
adjacent lots are partly forested areas; (3) the trees in both lots had
been felled, including fruit bearing coconut trees, but the number of
those felled are unknown, there being no records available; what
remains are cogon grass and other wild plants and the traces of rivulets
created by torrential rains. The terrain is rolling and mountainous
although these areas have long been developed and used by the PNOC
before the filing of the cases, which though not traversed directly by the
provincial or national roads, are already accessible by all-weather roads
and are adjacent to different PNOC buildings.
The Commissioners' Report discussed in detail the circumstances which led
to the reclassification of subject lots from agricultural to industrial land upon
declaration of the city of Ormoc and the town of Kananga that the areas
around the geothermal plants are industrial zones. The schedule of values
prepared by the municipal assessor which classified the subject lots as
industrial property was also appended to the said report submitted to the trial
court.
Taking its cue from the Commissioners' Report, the trial court took into
consideration among others the lots' classification as industrial land in fixing
the just compensation. Throughout the entire proceedings in the trial court, no
objection was proffered by petitioner on this matter.

As it were, the Court cannot but agree with the CA when it ruled that
petitioner's belated objection on appeal of the classification of the subject lots
could no longer be entertained. For the same reason the Court refuses to
consider petitioner's Manifestation17 stating that a property adjacent to the
subject lots was purchased at P 80.00 per square meter and urging the Court
to peg the value of the subject properties at the same amount. Suffice it to
state that issues raised for the first time on appeal and not raised timely in the
proceedings in the lower court are barred by estoppel. Matters, theories or
arguments not brought out in the original proceedings cannot be considered
on review or appeal where they are raised for the first time. To consider the
alleged facts and arguments raised belatedly would amount to trampling on
the basic principles of fair play, justice and due process.18
Finally, on the basis of all its arguments, petitioner asks this Court to set aside
the lower courts' factual finding as to the just compensation for the subject
expropriated lots.
It must be stressed that only questions of law may be raised in petitions to
review decisions of the CA filed before this Court. The factual findings of the
CA affirming those of the trial court are final and conclusive. They cannot be
reviewed by this Court, save only in the following circumstances, which we
find absent in the instant case: (1) when the factual conclusion is a finding
grounded entirely on speculations, surmises and conjectures; (2) when the
inference is manifestly mistaken, absurd or impossible; (3) when there is a
grave abuse of discretion; (4) when the judgment is based on a
misapprehension of facts; (5) when the findings of fact are conflicting; (6)
when the CA went beyond the issues of the case in making its findings, which
are further contrary to the admissions of both the appellant and the appellee;
(7) when the CA's findings are contrary to those of the trial court; (8) when the
conclusions do not cite the specific evidence on which they are based; (9)
when the facts set forth in the petition as well as in the petitioner's main and
reply briefs are not disputed by the respondents; and (10) when the CA's
findings of fact, supposedly premised on the absence of evidence, are
contradicted by the evidence on record.19
Clearly, petitioner has failed to establish that the present case falls under any
of the exceptions enumerated above. A perusal of the facts and evidence
presented does not convince this Court to deviate from the findings of fact of
the two courts below. The lower courts properly appreciated the evidence
submitted by both parties as regards the nature of the expropriated lots.

These courts have determined that the lots were industrial at the time of the
taking by petitioner for expropriation.
To recapitulate, in denying the instant petition, the Court relies on a wellestablished doctrine. Thus, in the present case, the findings of fact of the CA,
affirming those of the trial court, cannot be disturbed, modified or reversed by
this Court in a petition for review under Rule 45 of the Rules of Court.
WHEREFORE, the petition is DENIED and the assailed decision and
resolution of the CA areAFFIRMED.
SO ORDERED.
TERESITA J. LEONARDO-DE CASTRO
Associate Justice

WE CONCUR:

REYNATO S. PUNO
Chief Justice
Chairperson

ANTONIO T. CARPIO
Associate Justice

RENATO C. CORONA
Associate Justice

ADOLFO S. AZCUNA
Associate Justice

Go vs ca

Facts:

Petitioner, while traveling in the wrong direction on a one-way street,

almost had a collision with another vehicle. Petitioner thereafter got out of his car,
shot the driver of the other vehicle, and drove off. An eyewitness of the incident
was able to take downpetitioners plate number and reported the same to the
police, who subsequently ordered a manhunt for petitioner. 6 days after the
shooting, petitioner presented himself in the police station, accompanied by 2
lawyers, the police detained him. Subsequently acriminal charge was brought
against him. Petitioner posted bail, the prosecutor filed the case to the lower court,
setting and commencing trial without preliminary investigation. Prosecutor reasons
that the petitioner has waived his right to preliminary investigation as bail has been
posted and that such situation, that petitioner has been arrested without a warrant
lawfully, falls under Section 5, Rule 113 and Section 7, Rule 112 of The 1985 Rules
of Criminal Procedure which provides forthe rules and procedure pertaining to
situations of lawful warrantless arrests. Petitioner in his petition for certiorari assails
such procedure and actions undertaken and files for a preliminary investigation.

Issues:
(1) Whether or Not warrantless arrest of petitioner was lawful.
(2) Whether or Not petitioner effectively waived his right to preliminary
investigation.

Held: Petitioner and prosecutor err in relying on Umil v. Ramos, wherein the
Court upheld the warrantless arrest as valid effected 1 to 14 days from actual
commission of the offenses, which however constituted continuing crimes, i.e.
subversion, membership in an outlawed organization, etc. There was no lawful
warrantless arrest under Section 5, Rule 113. This is because the arresting officers
were not actually there during the incident, thus they had no personal knowledge
and their information regarding petitioner were derived from other sources. Further,

Section 7, Rule 112, does not apply.

Petitioner was not arrested at all, as when he walked in the police station, he
neither expressed surrender nor any statement that he was or was not guilty of any
crime. When a complaint was filed to the prosecutor, preliminary investigation
should have been scheduled to determine probable cause. Prosecutor made a
substantive error, petitioner is entitled to preliminary investigation, necessarily in
acriminal charge, where the same is required appear thereat. Petition granted,
prosecutor is ordered to conduct preliminary investigation, trial for the criminal
case is suspended pending result from preliminary investigation, petitioner is
ordered released upon posting a bail bond.